Identify the best category in the cash fow statement prepared by the indirect method for each item below. Purchase of machinery Investing CF Bank loan repayment Financing CF + Sale of the house (computer producer) Operating CF + New issue of shares Choose... Sale of the truck (truck producer) Choose... Increase of trade receivables Choose...

Identify the best category in the cash fow statement prepared by the indirect method for each item below. Purchase of machinery Investing CF Bank loan repayment Financing CF + Sale of the house (computer producer) Operating CF + New issue of shares Choose... Sale of the truck (truck producer) Choose... Increase of trade receivables Choose...

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Indicate if the following transactions increase or decrease cash and classify the transactions as Operating, Investing or Financing Activities Enter I For increase and D for decrease. Enter O for Operating, I for Investing, and F for Financing. 1. Pay taxes D O 2. Collect cash from customers I O 3. Issue common stock F 4. Take out a loan from a bank 5. Purchase stock in another company I 6. Sell government debt security 7. Buy a patent 8. Retire a bonds payable 9. Pay dividends 10. Pay insurance 11. Pay interest on a loan 12. Pay principal on a loan 13. Pay salaries 14. Repurchase treasury stock 15. Sell a copyright to another firm 16. Pay suppliers for inventory 17. Dividend payments received from stock investment. 18. Interest payments received from investment in government debt securities.
Assuming Sherban reports dividends paid as a financing activity: Calculate net cash flow from operating activities. Use a proper three-line title. Calculate Sherban’s current cash debt coverage ratio, cash debt coverage ratio and free cash flow. Using your answers in part (b) and comment on Sherban’s liquidity and financial flexibility. Under IFRS, how else might Sherban account for cash dividends paid in the cash flow statement?
D&D Company reports select items from its statement of cash flows. Identify those items related to investing activities and co- net cash flows from investing activities. Activity Cash paid to purchase property Cash from selling merchandise Cash paid for income taxes Cash received from a long-term note Cash paid to repurchase stock Cash received from sale of investments Cash received from issuing equity shares Cash paid to purchase merchandise Cash paid to purchase investment securities Cash paid in salaries and wages Note: Cash outflows should be indicated by a minus sign. Activity Net cash flows from investing activities $ Amount 0 Amount $ 400,000 688,000 135,000 850,000 100,000 40,000 500,000 710,000 50,000 410,000
Match each item with its appropriate section on the statement of cash flows: operating, investing, financing or noncash investing & financing.
Match each of the following term with the corresponding description. Not all descriptions will be used._____ Operating activities_____ Indirect method_____ Cash equivalent_____ Investing activities_____ Direct method_____ Financing activitiesA. Measures the percent of net income that comes from high-margin products.B. Includes such events as the receipt of dividends and interest on investment assets.C. Includes assets that are very liquid and have original maturities of three months or less.D. The percent of total debt represented by a company's cash account.E. These activities include only purchases made with borrowed funds.F. Where cash flows from operating activities are calculated by converting each revenue and expense item from an accrual to a cash basis.G. This ratio multiplies net income by the average rate of interest the company receives on its investments.H. This ratio uses net income instead of operating cash flow to Analysis a company's ability to finance the cost of its…
Which of the following would be reported in the either the operating, investing or financing sections of the statement of cash flows prepared under the indirect method? Group of answer choices Declaration of an unpaid cash dividend Acquisition of a factory warehouse by issuing long term debt Gain on the sale of equipment sold Write-off of a noncollectable account receivable
(all options information and correct answer please)Which of the following are ‘uses’ of cash from a cash flow perspective? (mark all that apply) a. Borrowing on the firm’s revolving line of credit b. Implementing a new share buyback program c. Purchasing a piece of real estate where you plan to build a new factory d. Purchasing inventory
Which of the following is included in the financing activities on a statement of cash flows? 28 Multiple Choice O Changes in accounts payable. Purchases of equipment. Paying interest to lenders. Cash dividends paid.
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